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Featured Post | Innovation | Revenue

Insight killed the video star: The role of video in premium subscriptions

It doesn’t seem so long ago that premium video was the great hope for publishers. Newspapers including The Daily Telegraph were investing heavily in building up their video teams, only to have the ground fall away from underneath them when platforms changed the terms of agreements. The result? Newspapers cut their losses and jettisoned the teams around which they had so recently built their strategies.

Premium video now finds itself in a bit of a limbo. It is no longer the star of most publishers’ offerings (save for a few examples). And it has taken a back seat when it comes to the marketing of news paywalls. Instead, insight and access are the new tentpoles of subscriptions. That’s never been more clear than when the Telegraph, fresh from abandoning its video unit, launched an out of home ad campaign heralding its unfettered access to Westminster.

The Athletic has taken a similar approach. The sports analysis site, which has outperformed during Covid, has emphasized the access its journalists have with athletes (and the access its subscribers get with the journalists). Crucially, The Athletic has eschewed video for the most part. The company does create or licensing video. However, it does not view it as central to its value proposition, as this interview with its president and cofounder Adam Hansmann demonstrates:

“According to Hansmann, the industry’s sense of news, often based on daily newspaper deadlines rather than what readers will pay for, is outdated. ‘The modern fan already knows what happened in a game, whether it be from Twitter or Instagram or Facebook. They’ve seen the highlights a million times on the internet’”.

Short and social

Hansmann’s nod to the popularity social video is telling. Mobile video is still far and away the largest growth market for the medium. That’s especially true in markets like China, where short-form video dominates any growth charts. Users spent a total of nearly 600 million hours per day watching short-form videos on mobile in April 2019. That’s more than in any other category.

Additionally, premium video is expensive to produce and the ROI is less clear-cut than for the mass-produced videos on YouTube. As Vanita Kohli-Khandekar explains: “Because [ad-supported] video is free, platforms will do anything to get eyeballs. But subscription-supported programming (usually) is well-researched, written and produced – whether in entertainment or news.”

So, the bottom has dropped out of the video advertising market on platforms. Short-form video is the new normal. And even sports-based digital publications don’t feel the need to make premium video part-and-parcel of their offering. Is it now time to call “cut” on the concept of premium news video at newspapers?

Not news

News publishers do license footage and social video to accompany breaking news. However, the reality is that, unless premium video is a newspaper’s key focus, it just doesn’t make sense for them to invest in strictly news-centric video. For one thing, news video has a shorter tail than other types of video. For another, given that individual papers have a far smaller footprint than other platforms, it’s unlikely that they can attract enough eyeballs to compete with viewers on, say, YouTube.

That is, in part, why publishers like Joe (and its current affairs-based YouTube spinoff PoliticsJOE) choose to produce vox-pops and simple interviews. Frankly, they suit the ad-based platforms better. Even The Financial Times, which does produce longer form videos, typically hews close to the interview-led format on its in-house videos. This format entails a relatively low investment in terms of time and editing, despite looking extremely professional. However, they don’t match the level of production quality of traditional broadcasters or OTT entertainment services.

Head of audio and video for The Evening Standard Chris Stone said: “When a breaking news event happens there is obviously massive spikes in traffic, and everybody’s very interested in this one thing that’s happening. And so, it’s actually quite easy to serve video to that audience, because there’s people out there that are looking for that right then. But it tends to be a shorter tail. And that spike will disappear very quickly. And then you’ll be on to the next thing.”

The lifestyle lifecycle

Instead, he argues that lifestyle video content is the way forward for newspapers. It has a longer lifespan and greater opportunity for commercial partnerships.

Paul Newman is brand director for Future Plc’s home interest titles. Speaking about its own “pivot to video” with the Real Homes Show, he notes that: “Real Homes Show… has been a huge success since we launched it last April. We generated hundreds of thousands of views of the show. It’s proved incredibly popular with commercial partners.”

“I think the important thing is just to start with a good solid business plan, and to understand why you’re creating video, rather than just creating video because you think you should, or because somebody in senior management thinks, ‘Oh we haven’t gotten the video content, maybe we should get on with creating some.’”

The success of lifestyle content in attracting users to sign up for a subscription has already been clearly demonstrated by The New York Times, whose Cooking app is frequently cited as a reason for paying. It is, unsurprisingly, heavily based around video.

Similarly, major lifestyle publications have made their archive of health and fitness videos available as part and parcel of their memberships. The reality, then, is that while video is still a good investment for newspapers for driving subscriptions, oftentimes news video is not.

Marketing medium

So, does that mean that there is no opportunity for newspapers around news video? Not at all. Just look at the success of Vox’s Explained series on Netflix. It delivers an awful lot of value to the parent brand in other ways that aren’t primarily monetary. At the time of Explained’s launch, Vox’s editor-at-large Ezra Klein stated that “… the Vox team did think about the overall Netflix audience, which is much bigger than Vox’s. But not as much about whether those people were watching on phones or tablets or other devices.”

Newspapers also recognize that video consumption habits are different among their key demographics. Consumption is growing across the board. However, it is effectively the primary means of media consumption among younger audiences. The Guardian, which hit one million subscribers on its YouTube channel last year, is keenly aware that those younger audiences are the key to its future.

One million subscribers may not sound like a lot on YouTube. It is considerably smaller than many individual’s channels, and any ad revenue it generates is likely to barely cover production costs, if at all. That, after all, is why many larger (non-media) YouTube channels operate Patreon or donation models as well.

The longer-form explainer news videos that The Guardian produces and makes available for free is effectively the best form of brand marketing possible. It hits audiences where they typically spend their time and can be used as a lure to drive interest back to the paper’s own membership scheme. More than that, as audiences shift to seeing YouTube as a primary source of news, it helps demonstrate that the brand can be trusted above all the conspiracy and polarized videos that typify the platform.

News publishers are serious about the quality of their journalism, no matter the medium. As younger people’s consumption habits lean further towards video, then investment in news video is a way to communicate that quality. It just requires publishers to recognize that the return on that investment is unlikely to come quickly or easily. Rather, it will come from a deeper overall relationship with the audience segment on which they will soon depend.

Advertising | Revenue

Reducing subscription churn is critical for advertising revenue

The deluge of advertisement and subscription offerings can lead to rampant reader fatigue. In this digital age, subscription churn presents an ongoing problem for media companies. Benchmarks place the media and entertainment industry near the middle of churn averages, between 5-6%.

So, it’s no surprise churn is a big topic of conversation. However, what is less often discussed is the impact churn reduction strategies have on advertising revenue. Spoiler: Yes, they have a massive impact.

We’ve said before that subscription and advertising-based revenue models are the future of media. Unfortunately, though, some companies continue to underestimate the effect of subscription churn on advertising revenue and overall company value.

Understanding how these revenue models support one another empowers better decision making, presents opportunities for data sharing and cost reduction, and just generally improves performance. It all boils down to leveraging subscriptions data in your advertising sales and prioritizing churn reduction strategies that improve ad performance.

Modern ad sales boosted by solid subscriptions data

Ryan Holmes, Chairman and Co-Founder at HootSuite, points out that the average American consumer has seen a massive increase in daily advertisement exposure. In fact, since the 1970s, “that number has increased by a factor of 10 to upward of 5,000 ads per day.”

Highly engaged audiences are inherently valuable to brands. This is particularly true when compared with risky ad placements on social media, which can end up alongside fake news, or worse. These inundated audiences around the world require far more specialized, contextual advertising to build long-standing relationships with trusted brands.

At Lineup, we’ve long advocated for audience-based ad sales. But where does the best audience data come from? Subscriptions! Thus, when an advertising team can leverage subscriber data, particularly from loyal, long term subscribers, more effective strategies can be employed to target campaigns and better activate key audiences.

Customer data platform, Blue Conic suggests that most brands don’t actually leverage the power of this kind of first-party data to their full advantage: “Less than 5% of marketers say they’ve yet to realize 80% or more of the potential of their first-party data. They include information provided by their audience in some facets of their marketing but have yet to realize the desired ROI from the source.”

Effective churn reduction strategies impact advertising

Applying successful churn reduction strategies obviously benefits the subscription team with stronger retention rates to improve overall revenue growth for a company. However, successful reduction strategies also improve the impact of advertising revenue.

Prioritize personal experiences

Personalized subscriptions and ads are likely to mutually benefit each other. For example, subscriber data that builds stronger reader profiles and return-rates can, in turn, enable advertising teams to offer more insightful contextual targeting to a captive audience.

Successful advertising requires engaged audiences who trust the publisher’s content and return often. The act of subscribing indicates the difference between a casual web visitor and a true, returning, reader. And advertisers are eager to get in front of those eyeballs whenever possible.

In 2019, data management platform Cxense demonstrated this in the global market. Online marketing team members of major Danish advertiser Nordjyske Medier successfully leveraged personalized customer data to increase “click-through rates by 300 percent on average — while digital subscriptions grew by 50 percent in the same period.”

Personalized experiences are critical for turning casual web visitors into subscribers (whether paid or free). They are also essential for turning those subscribers into a fully monetized audience.

Build loyal audiences

If personalized experiences convert visitors to subscribers, the next step is ensuring those new subscribers stick around long enough to impact your bottom line. An individualized customer experience on both ends of subscription and advertising content creates deeper connections with audiences, making them likely to remain loyal to brands in the long term.

A loyal audience base attracts marketers because these kinds of audiences prove to be more responsive. Twenty years ago, many companies did not have the digital resources to so carefully segment, track, and individualize content for key audience groups in a relationship between subscriptions and advertisements.

But now, brands that can leverage cross-functional strategies and shared data insights to their advantage can build even greater loyalty to their high-quality content and ethical, reliable journalism. This approach builds strength across departments within media businesses so that everyone from audience teams to editorial teams has a basic understanding of marketing principles and can contribute meaningfully to the strength of your brand.

The result? Readers transform into brand advocates!

(Of course, systems like Amplio can strengthen brand loyalty by leveraging subscription data to the benefit of interested marketing teams.)

Understand why readers leave

When you understand the reasons readers cancel subscriptions, you’re also more likely to pick up on parallel reasons the same readers don’t interact with ads. It’s time to stop guessing why readers leave and start asking. Like many of the other benefits we’ve discussed so far, taking this integrated approach to discovery can benefit all teams and departments towards achieving collective company goals.

A solid approach to identifying at-risk subscribers is not only a marketing strategy, it’s equally critical for the success of your advertising sales team.

One goal, two revenue streams

Reducing subscription churn empowers you to focus on collecting better data from existing, long-term customers to the distinct benefit of advertising revenue. This approach can move a company from focusing merely on impressions, to actual impact.

Companies that retain more subscribers spend less time and resources strategizing against losses — as many businesses have had to do in the last year. Instead, they will be energized to use those resources for improved subscriptions and visibility to marketers.

Advertising | Revenue

How one botnet evolved its fraud to elude detection and steal revenue

When it comes to cheating advertisers out of their ad spend and stealing revenue from publishers, fraudsters are upping the ante. By monitoring of invalid traffic (IVT) associated with digital advertising, our team tracked an unrelenting, sophisticated operation first publicly reported as 404bot.

By using a broad range of tools, our researchers were able to pinpoint the actual proxy software that had been installed on consumer PCs. This key discovery allowed us to closely track the fraud as it morphed. We found this scheme to be particularly devious for two reasons:

  1. The offending program was typically installed unknowingly through various seemingly safe entry points. (This is (often referred to as a PUP, or potentially unwanted program.) It would then turn the downloader’s computer into a botnet carrying out ad fraud in the background.
  2. Much like software companies roll out bug fixes and updates to their code, the scheme similarly evolved its mechanisms for fraud. Each adjustment was made with the intent to elude detection.

The following is a debrief on the uncovering of the scheme. We outline what tipped us off to foul play. We also discuss the steps we are taking to mitigate the activity and why it’s so important to monitor invalid traffic to protect all sides of the programmatic supply chain.

The deep dive into botnet activity

In mid-2019, our team observed suspicious botnet activity. We spent weeks investigating and tracking various suspicious identifiers surrounding this activity. Finally, we were able to pinpoint a unique signature. We then matched it to a binary of a desktop application called NotToTrack. This free VPN, readily available for any consumer to download, masked itself as software meant to secure the installer’s computer.

Our team was able to obtain the VPN’s actual malware binary. We ran it in our clean room, where we can safely download malware ridden software and de-obfuscate code. This allowed us to:

  • Record its web activity and thus reconstruct the behavior seen in impressions from the relevant time period
  • Validate that it is based on Chrome Embedded Framework (CEF), a popular framework for web based applications that can be used both legitimately and by bots
  • Develop new detection methods based on these observations

The discovery of this VPN and its executable file allowed us to see the full breadth of the operation. What we found was very persistent, targeted ad fraud.

Summary of the bot’s evolution

The VPN front was just one point of entry for the operation’s fraud. It was probably not even the most common distribution vector.

Following the newly discovered evidence, we have found forum complaints that indicate this operation has been underway since as early as November 2016. Based on evidence we’ve gathered, we also believe the origins of this bot are the same as 404bot, a recent fraud scheme made public by another verification provider.

However, our findings reveal that this bot has not ceased its fraudulent activity. And as it attempts to elude detection, it has moved from its initial domain spoofing practice onto other mechanisms.

In the graph, we see the subset of spoofed domains tracked by Integral Ad Science (blue) alongside the rest of the malware-originated activity that Moat has been tracking (orange). Where the domain spoofing ceases (blue activity falls flat), we see the fraudulent impression activity actually has continued as the perpetrators evolved their tactics.

What is the impact that we are seeing?

The question of impact always comes up when discussing the discovery of an ad fraud scheme. This is usually in relation to stolen impressions and ultimately, lost ad spend. But even as we bring the pieces of the puzzle together, the true size of any botnet is hard to measure. So, we caution against assigning too much value to a market impact analysis.

Even more important is how this bot illustrates the ability for these schemes to quickly mutate. So when the conversation turns to impact, we firmly believe it should not be about size, especially as it relates to protecting our clients and doing what is right for the industry. A botnet that is “small” by our measurement today could easily evolve into a much larger threat tomorrow.

What we do know, from the portion of traffic we are able to measure, is that at its peak, this bot was clocking in at around 11 million impressions per day. And, as recently as March, it was still showing activity at just under 2 million impressions.

Further, the nature of how this bot is operating—by targeting the computers of unknowing consumers through shifty mechanisms—is particularly invasive. The distribution of malware can have severe consequences on hardware. The complaints of users who unknowingly downloaded the offending proxy software mention various, flag-raising behavior. For example, at the Bleeping Computer forum a user describes, “I have a bunch of programs running that I did not allow to start… My computer in-turn slows down due to all these programs running their bleep [sic]. Earlier today, I had 3 virus programs scanning my computer. I never downloaded, let alone installed them.”

How to protect your investments from IVT and ad fraud

Unfortunately, ad fraud is a pervasive and pesky byproduct of programmatic advertising. This is thanks to an environment that affords ample anonymity as well as produces a significant amount of profit. Having meaningful data is the first step in enabling us all to ask the right questions about these schemes that will continue to occur.

Moat has numerous methods for detecting various forms of IVT. As we identify and track fraudulent botnets, we use our findings to understand how they evolve. We continuously develop detection mechanisms that can identify and separate bot activity from human. We believe everyone in the ecosystem has a role to play in eliminating ad fraud and addressing IVT. It is through continued collaboration, information sharing, and advancing our technology that will help us build trust and ultimately, stop the cheaters from lining their pockets.

Perspectives | Revenue

Will we make the same mistake with CTV as we did with the web?

It’s a familiar scenario. One of the big ad tech players announces a change and we are all left to interpret what exactly it means. The only certainty is that it will take some effort to understand the full picture, the driving force behind it, and a plan of action. 

As the big players quickly and quietly expanded their walled garden ecosystems, many publishers found themselves left without a key. We all know these big players own most of the market share and also dominate most of the growth as well. By the end of 2020, it’s predicted that nearly 70% of US digital ad dollars will be spent with Amazon, Facebook or Google. 

However, publishers do have options for regaining control, especially when it comes to new growth areas like connected TV (CTV). Even before Covid-19 drove consumers to CTV and streaming in record numbers, 2019 saw a 330% rise in programmatic OTT/CTV ad transactions with CTV market advertising spend in the US valued at $6.94B last year. As you begin to build out your CTV strategy, it’s important to learn from the lessons of the past to avoid making the same mistakes. 

Own your audience relationships 

Distribution and tech partnerships often begin with great promise. When Apple introduced their Newsstand offering, it was positioned as a lucrative way to expand subscriber reach on iOS devices. Once Apple announced they would only allow single issue sales and began acting as an intermediary by keeping the subscriber data collected on their platform, the need for a business model more balanced with publisher needs became evident.

Nothing is more important than your audience and the ability to maintain control over the close audience relationships you cultivate. Effectively identifying these loyal audience segments and estimating user lifetime value is the foundation of a successful strategy. If you’re not working with an independent tech provider, it’s important to consider the potential implications and potential risks of partnering with a competitor or potential competitor and what impact that might have on your audience relationships.

Control and leverage your data

Your data is a key asset in your private garden. Controlling who gets in and what goes out is especially important as GDPR, TCF, and CCPA come into full effect. These changes have immediate impact on your revenue, but also secondary costs from the business model adjustments needed when third-party cookies are disabled.

Niche targeting, personalization, and frequency capping all depend on transparency and insights derived from data. Controlling and fully understanding your data makes it possible to hone your monetization strategy and create innovative opportunities for advertisers. When others have control over your data, it becomes more challenging. 

For example, concerns have been raised around Google’s proposed TURTLEDOVE solution and its less frequent reporting structure. This poses a big challenge around leveraging data to fully optimize and capture revenue. As publisher first-party data becomes increasingly valuable and offers more monetization opportunities, it’s important to consider whether your provider is data neutral or more interested in harvesting your data. 

Control your infrastructure  

Make sure you are the one in charge of all the tech decisions in your private garden. In a technologically nuanced space like CTV look for partners that provide the expertise and infrastructure needed to ensure data protections, but also allow you to maintain control. Be wary of partnering with players who are also competing for your audience’s attention. And ensure that you will have enough flexibility in customization and business rules.

When Google first acquired DoubleClick back in 2008, they promised it would offer publishers more tools, enhanced productivity and additional revenue while freeing up resources to allow publishers to focus more on building and maintaining a web presence. In reality, it was one of the first deals that helped Google establish dominance and affect changes in customization and control that continue to ripple through the entire industry. Again, be very careful with who you let into your private garden. 

Diversify your revenue 

The end of third-party cookies means short-term revenue losses are likely. Many publishers have already begun exploring ways to diversify their revenue streams. Meredith is a great example of strategically embracing data management and ownership. The launch of their Data Studio and e-commerce sites connected back to their brands has helped optimize revenue streams.

Engaging loyal audience segments through registrations and subscriptions is another strategy that many of you have begun to embrace. Build upon existing successes like The New York Times has done with the introduction of their stand alone NY Times Crosswords and NY Times Cooking offerings. This is another avenue for strengthening audience relationships while building more robust first-party data. 

This industry shift towards CTV offers another consideration for diversification. It also provides a prime opportunity to take back control and build your own private garden. Learn from the past in order to make careful choices around who you partner with and how you protect your investments from the start. This will give you the key to your own private garden and bring success in expanding into new growth areas.  

Perspectives | Revenue

Is the events industry dead? Not by a long shot.

Periods of intense crisis often lead to innovation, and 2020 is no exception. In the year of the Covid-19 pandemic, the media industry faces a new threat to revenue: the disappearance of in-person events and the need to rapidly pivot to protect revenue. 

The cancellations of industry conferences and trade shows between March and May resulted in a loss of at least $2.3 billion in show organizer revenue, according to the Center for Exhibition Industry Research. The total impact to the economy was at least $14 billion.

While that’s true, audiences have shown they are ready to engage with digital communities and premium content. Sponsors and exhibitors also recognize the value of digital data. While the shift in the events model is daunting, it presents new opportunities for subscription-based revenue and memberships and alternative sources of revenue with digital innovation. In fact, media companies may actually have more paths to revenue as they emerge from the crisis. 

We work with some of the biggest names in media, entertainment, technology, retail and information services on digital transformation and product development. One thing we do is help them pivot to a virtual events model. That includes improving their conferences sites, and enhancing their digital ecosystem (the technologies that connect their community with content and data). 

These companies are redesigning their events to accommodate travel restrictions, social distancing, and new virtual consumers. Virtual events have become a necessity in the near term, whether for trade shows, conferences or entertainment, and they have also become a long-term strategic opportunity for industry leaders. But the solution isn’t just shifting the venue to Zoom. Premium, memorable, and customized experiences are more important in a virtual world.

The future of events

Here is our vision of what the future of events could look like in the coming months and years: 

In person and online

The events industry is already pivoting quickly in response to new demands and trends, and the industry will be led by software and data-driven companies that connect people, both in person and digitally. As different areas reopen, physical events will regain their importance. However, in-person events will be only one important part of a continuous conversation with audiences. Value will be provided to the community throughout the year, empowered by digital experiences and engagement. 

Value and pricing

The events of the future will deviate from single ticket purchases to membership, tiered access, VIP content, and online certifications and learning opportunities. Post-pandemic events will be multi-platform, multi-device, and simultaneously virtual and in-person. They will be supplemented by micro-events, curated content experiences, and educational and training opportunities.

Monetization

Data monetization and digital products are critical to future events revenue. By now, every leading company in the world is either a native software and data company. Or, like Fortune, GE, Disney and the NFL, they are evolving to become one. As these companies have found, digitization has the opportunity not just to reclaim lost revenue but to create new revenue sources and diversified revenue streams. 

The “digital venue” is unconstrained by scale and opens up new and lucrative opportunities. Those that will succeed  in the events space will be the ones who seize the opportunity to build new digitally empowered business models that drive more predictable revenue for events companies, sponsors, and exhibitors.

Membership

Consider Fortune’s membership model. Community members pay for different levels of content access, virtual, live events and other networking experiences throughout the year. Fortune hosts exclusive in-person conferences annually, like the Most Powerful Women Next Gen Summit for rising women leaders, which has traditionally featured curated dinners and digital content supporting the event. The company has a similar model for aspiring CEOs. 

Fortune also hosts a number of regular, smaller virtual events, by industry and topic. By hosting weekly micro-events for its audiences, Fortune can create over 100 opportunities for sponsorship during a given year. Nothing replaces the value of gathering in person. However, digital venues and premium content support continuous conversation with audiences and create enduring value for sponsors. This is a model that will provide media and events companies with amplified value in the years to come. 

Sporting chance

Or consider the sports industry. The NFL makes money through ticket fees, certainly. However, it drives a majority of its revenue as a content company. Disney is also inspiring. A consumer pays to attend a Disney movie or gain admission to a theme park. But that same consumer also pays a regular fee for educational tools, online games and digital streaming services. Disney+ exceeded $20 million in revenue in just its first month of release. 

As we look to an events future that leverages the power of combining both digital and in-person offerings, companies will profit from data licensing and creating actionable data and sponsorships for audiences curated by demographics, purchasing power, and interest. 

Community

Event companies that build valuable micro-communities will thrive. With increased virtualization, there will be a greater need for people to have personalized and premium experiences in digital channels. Companies like Bevy are already capitalizing on this need by helping brands build and scale their digital communities. Bizly has pivoted from helping its clients plan and manage physical events, to planning and managing virtual events. Cameo enables celebrities to deliver personalized messages to fans. Crowdcast hosts interactive, live online conversations at scale. 

The future of events will be hybrid. A single physical event will be amplified by data and content experiences, all within one digital ecosystem. This is especially important when we consider younger, digitally native audiences. They are adept at navigating Fortnite, TikTok and Twitch. They are not confined by physical venues and expect seamless digital integration and community. This allows event companies to offer premium access to unique experiences and content.

It’s possible that some things will be lost in the transition – like the spontaneity of an in-person event, running into the right person at just the right time. Companies like Grip are trying to recreate this kind of spontaneity with intelligent event matchmaking software to develop lasting business relationships. It can certainly work: online dating companies have been using similar algorithms for years.

Value proposition

All this being said, the fundamental value proposition of what the events business is has not changed. Organizers still want to monetize the experience. Attendees want inspiring content, and they want to forge the connections that will help them and their businesses grow. Sellers still want to connect with buyers. 

But how these goals are accomplished will be different. Leaders will be the ones that understand these emerging trends and transition their models toward digital content, data and design. They will combine big events with curated micro-events. They will work with experienced digital partners to deliver content seamlessly across platforms and channels, and monetize data and insights with machine learning. The digital ecosystems that empower digital content, marketing, and premium experiences across platforms will become a source of competitive advantage. 

The media events industry is not out of business. In fact, it is already finding more lucrative, scalable opportunities. The challenge is deciding where to start, because the temptation will be to want to pursue all of these opportunities. The companies that succeed will be customer-focused. They will build for a narrow set of business outcomes. They will experiment. They will have the wisdom to know when to sustain or pivot. And they will manically focus on minimizing the time it takes for them to realize value. With these goals at the forefront, the media events industry could undergo a remarkable transformation. 

Featured Post | Revenue

How Kumu’s Roland Ros partners with media companies for commerce and community

Global interactive platforms such as TikTok may strike a chord with younger audiences. Still, they miss the opportunity to drive hyper-local content and shape tight-knit transnational communities. It’s a significant and growing gap that Kumu, a Filipino-centric social app and livestreaming platform, seeks to fill with customized content channels. The combination of communication, commerce, and community allows fans to interact and purchase products while watching their favorite livestreamers.

It’s a smart move when platforms everywhere on the planet are forging relationships to become Super Apps. But content will be the factor that sets some of these Super Apps apart. By cultivating relationships with media companies and content creators, they can reach audiences with entertaining content that inspires lasting passion, not just one-off purchases.

It’s a blueprint that makes business sense for companies lining up to engage Internet-addicted populations in emerging markets. Boston Consulting Group’s Center for Customer Insight forecasts that Internet users in emerging markets, which include India, Indonesia, Kenya, Morocco Nigeria and the Philippines, will contribute 3x the number of new Internet users compared to developed markets. It’s a young community that will engage in “digitally influenced” content. They’ll also make purchases worth a whopping $4 trillion by 2022.

Continuing our series of DCN video interviews, I talk to Roland Ros. Ros founded Kumu, a livestreaming app that counts a community of more than 5 million GenZ and Millennial Filipinos spread across more than 50 countries. Kumu recently raised $5 million in a Series A funding round led by an impressive mix of investors including OpenSpace Ventures, Summit Media, and Philippines-based media conglomerate ABS-CBN. We discuss the importance of trusted conversations and the efforts of media companies, including Cosmopolitan and Esquire, to unlock the creative and commercial potential of its growing and global audience.

Here are three key takeaways from our talk:

Power community-driven commerce with authenticity and positivity

Younger audiences are eager to participate (and purchase) on platforms that make them feel involved and accepted. “GenZ and Millenials are tired of the social anxiety that comes with pretending life is perfect,” Ros explains. Authenticity has replaced attention as members no longer value millions of likes or hundreds of thousands of followers. The payoff is positivity, he says.  Kumu’s “Kumunity” appreciates “microtransactions and virtual gifts that simply say ‘thank you’ for the content you create.”

Segment according to journeys, not customers

Ros encourages companies to rewrite the marketing playbook to emphasize the “aha” moments that keep audiences everywhere hooked. To pinpoint these events, he relies on CleverTap to track behaviors, patterns and architect a customer journey to make each member feel like an individual. “The logic has to be clean: if this, then that.” Building these capabilities has allowed Kumu to reach “month four retention rates in the 40% range,” he says.

Micro-influencers have a massive impact

Ros reveals the fastest-growing business on the Kumu platform is driven by influencers and creators on the platform talking about their passions and interests. This realization has prompted him to partner with media companies to launch “the concept of an interactive social television network,” amplifying the content and content creators the community loves.

Ros also talks about blending content and commerce to pave the way for “Super Social Apps” fueled by connection and microtransactions. He also lifts a lid on the best practices that allow Kumu and its partners to reach “up to 10%” conversion rates for livestreaming commerce on the platform. 

Watch the full interview:

Perspectives | Revenue

Countering the revenue loss caused by ad blockers

In the last few months, ad blocking has taken a backseat in industry conversations and in the minds of publishers as they grapple with more immediate concerns, such as the revenue disruption caused by Covid-19 and Google’s decision to block third-party cookies by 2022.

Even though it doesn’t feel quite as pressing, ad blocking is probably a more persistent threat to publisher’s revenues than either of the aforementioned. In this article, we’re going to review the current state of ad blocking, see how publishers can estimate their revenue leakage, and discuss the pros and cons of the commonly available ad block countermeasures.

The state of ad blocking

According to the Global Ad-Blocking behavior report by GlobalWebIndex, 47% of users globally use an ad blocker today. There are many reasons why users choose to install ad blockers, such as constantly being bombarded with ads, the ads being annoying, irrelevant, or intrusive, and ads taking up too much screen space. There are also region-specific drivers of ad block usage. For instance, the mobile ad blocking rate is especially high in the APAC region. That’s because many users access the internet using 2G networks, and saving data bandwidth is a priority.

According to predictions made by Ovum, the revenue loss to publishers could be anywhere between $16 billion to $78 billion in 2020, depending on how actively publishers adopt (or don’t adopt) ad block countermeasures. Industry groups such as the Coalition for Better Ads help stakeholders in the ad tech industry align towards the long-term goal of making ads faster and less intrusive. But for now, most publishers are left to their own devices when it comes to figuring out how much revenue they’re losing and what they can do about it.

Estimating revenue loss

Once you have some basic information about your website, it’s actually pretty straightforward to estimate the revenue loss that you may be currently incurring. Here’s what you need:

  • Monthly pageviews
  • Average ad density (number of ads per page)
  • Average eCPM
  • Ad block rate (in percentage)

There are both free and paid JS scripts and analytics tools available in the market that you can use to track the percentage of ad block users among your visitors. If you just want a rough estimate, you can also review your country-specific traffic data and then apply the regional ad block rates to calculate the average adblock rate for your entire inventory.

Let’s assume a publisher receives 15 million monthly pageviews, with an average eCPM of $2.8, ad density of 3, and ad block rate of 28%. In this case, the revenue loss can be calculated as (28/100)*(5000000*2.8*3/1000) = $35,280/month or $423,360/year. (Here’s an adblock recovery calculator we designed to make this easier.) 

It’s important to note that revenue loss due to ad blockers grows in direct proportion to traffic. So, it may not be worth the effort for a publisher with less than 1 million monthly PVs to implement ad block countermeasures. However, larger publishers cannot afford to ignore the opportunity.

Countermeasure strategies

Messaging

Have you ever visited a site that asked you to turn off your ad blocker? That’s an example of a messaging-based ad block countermeasure. Whitelist requests are another example of this category of ad block countermeasures. Other variations include calls-to-donation, offering an ad-free pass, or selling a paid subscription with metered or unmetered paywalls. All of these are intended to offset the revenue loss caused by ad blockers. Messaging is a great way to establish one-on-one communication channels with your visitors. You can educate them about your business needs, and ask them to take specific actions to support you.

Circumvention

As suggested by the name, ad block circumvention solutions focus on trying to identify and circumvent ad blockers. Or, in simpler terms, they try to block the ad blockers. Ad block circumvention vendors essentially play whack-a-mole with ad blockers. They find loopholes in their scripts or delivery and exploit them. 

In response, ad block vendors frequently update their code to bypass circumvention. This makes ad block circumvention less reliable as a technique than other forms of ad block countermeasures. Circumvention also ignores the underlying problems that cause users to install blockers. And, for this reason, the vendors that provide this technology have fallen out of favor in developed markets.

Ad recovery via Acceptable Ads

Almost half of all internet users who use ad blockers use AdBlock and AdBlock Plus. The German company that makes these products, eyeo GmbH, runs a program called Acceptable Ads that allows publishers to serve less intrusive ad formats to a segment of opted-in users of participating ad block extensions, browsers, and content blockers. Ad recovery was envisioned as a middle ground between the legitimate needs of internet users and the business needs of advertisers and publishers. In terms of effectiveness, ad recovery usually beats messaging. That’s because it allows publishers to recover a larger part of their inventory, instead of just relying on the users who agree to grant their whitelist request or buy their ad-free pass.

Continued experimentation 

If there’s one thing that we can all agree on, it’s that ad blocking is here to stay. Users have more choice than ever when it comes to installing an ad blocker, whether that’s in the form of a native feature of privacy-focused browsers, third-party extensions, or mobile apps. The specific usage patterns on different devices may wax and wane over the years. But as a fundamental choice, ad blocking is now a permanent fixture of the ad tech landscape.

When ad blocking usage first took off, publishers did not have a lot of options to protect themselves against the cost of ad blocking. However, over the years, different forms of ad block countermeasures have emerged, which work with varying degrees of efficacy. The long-term solution to ad blocking still lies in respecting user choice and making advertising simpler, faster, and less intrusive. Until that happens, publishers need to keep experimenting with ways to protect their revenue by educating users and delivering better advertising experiences.

Featured Post | Innovation | Revenue

How three media companies are approaching virtual events and monetization

Many media companies have turned to virtual events as a way to engage audiences on a personal level during the pandemic. From webinars to virtual festivals, teams have worked to evolve their offerings as the long-term outlook for physical events remains uncertain.

The Financial Times, The Atlantic, and Bloomberg, are among media companies that produce events as one of their diversified revenue streams. They are also among those that have had to evolve their revenue strategy as their teams hit their stride with virtual events.

Maturing virtual events strategies

In March, FT Live went from being completely focused on physical events to virtual in just days. As a test, they launched The Global Economic Emergency webinar. And with just three days of promotion, they racked up over 7,000 attendees who logged in to watch.

“We had these huge numbers, and it was a bit of a lightbulb moment for us,” explained Orson Francescone, the Managing Director of FT Live. “We quickly realized that we could do something bigger and bolder.”

Weeks later, the company launched The Global Boardroom. The three-day event featured 110 remote speakers and boasted 52,000 registrations. The event focused on the impact of coronavirus on policy, business, and finance. And it was so popular that a second edition is scheduled for November.

The Atlantic has seen similar success with online registrants, with over 20,000 attendees attending their 28 virtual events. “It’s a larger audience than we would have been able to convene in person,” said Aretae Wyler, COO of The Atlantic. “It’s more international, and we’re seeing the same caliber of attendees.”

Bloomberg faced a different challenge with virtual events, as they already had an established Bloomberg TV offering. For them, it wasn’t a matter of a pivot to video. Rather, it was creating a distinct experience and value proposition for a new offering. This meant the focus for its virtual events had to be on the level of interaction attendees could have, and what the value would be for sponsors.

“Once we got crisp on these elements…what we needed from a platform, resource, and process perspective became self-evident,” Bloomberg Live’s Global Head Patrick Garrigan explained. “Not only are our audiences tuning in, they’re staying with us and engaging.”

The value for sponsors

For Bloomberg Live, attracting sponsors came down to the basics of why clients support events in-person. “We distil it down to three core attributes: thought leadership, brand awareness, and content creation and amplification,” said Garrigan. “Similar to in-person, it then becomes a matter of identifying how our platform can deliver on these metrics.”

Bloomberg delivers this by creating sponsor “moments” throughout its virtual programs, as well as allowing sponsors to share the perspectives of their senior leaders. They then share segments from the events widely across Bloomberg channels.

For the FT, it is their technology stack – as well as their access to large global audiences – that has been a key selling point for sponsors. Early on, the team focused on ensuring they had a strong analytics functionality in place. 

“We can analyze who is attending, what stage of the event, how they are engaging, and serve this intelligence to our sponsors,” Francescone outlined. “Sponsors really enjoy our platform because it’s giving them, from an ROI point of view, much bigger and more detailed numbers than in a physical environment.”

Big numbers are also a draw for The Atlantic’s sponsors. The publisher is gearing up for The Atlantic Festival in September which will be entirely virtual, and free to attend. Whereas they would normally have 3,000 in-person attendees, the team is targeting between one and 2 million registrants for the virtual version. 

Sponsor interest has grown as The Atlantic’s confidence in their model and ability to pull in high-caliber attendees. “Most of the sponsors that we have worked with in-person have been interested in trying this model with us,” said Wyler. “Part of that is the belief they have in our power to convene and engage audiences. We’ve maintained a 75% average watch time for our audience, which is pretty incredible.”

Reader revenue and data

When it comes to audience revenue, the FT is now charging delegates for all its events from autumn onwards. But for the second edition of its Global Boardroom event in November, FT Live is taking a freemium approach. 

The event has three tiers of ticketing. First, they’ll offer a free pass which gives live access to talks, Q&As and polls. A  $65 pass provides on-demand access to all talks and summary reports. The professional pass, at $385, adds 1-1 networking, exclusive access to extra sessions, and a business community area.

Beyond ticket sales, the FT sees long-term opportunities for the newly engaged data. “Of the 52,000 people we had attending The Global Boardroom, about 75% were completely new to us,” said Francescone. These attendees can be monetized not just through the event, but as part of the FT’s core subscription strategy. 

The Atlantic also sees opportunity in bringing in new subscribers. “We are constantly thinking about how this can be a driver of subscription growth,” Wyler emphasized. “The benefit of virtual events is that it’s an opportunity to convene both the superfans, but also to introduce The Atlantic to new audiences.”

In previous years, tickets to the in-person Atlantic Festival have ranged from $50 to $975. However, registration to the virtual Festival in September this year is free. That said, there will be subscriber-only benefits like exclusive sessions and Q&A opportunities to bring value to existing subscribers and entice new joiners.

Bloomberg has historically not charged for its events. However, the exception is their Bloomberg Breakaway CEO membership community, where virtual events have been leveraged as part of the membership package.

“We’ve created content that is exclusively for members. It gives them the tools, best practices, and essential feedback to grapple with the issues that are impacting business,” said Garrigan, highlighting the opportunity to provide another touchpoint to members through virtual events.

The future of virtual business events

Garrigan sees virtual events being a part of Bloomberg Live’s programming for the foreseeable future. “Given Bloomberg Media’s global footprint, virtual events are such a natural fit,” he said. “While we are incredibly eager to get back to in-person events as soon as it’s safe to do so…[virtual events] serve as a way to connect broad geographies in real-time that may not be able to join us in-room.”

For FT Live, their early success gave the team the confidence to run events for the rest of the year in a digital form. But for 2021, they are being cautious. Francescone suspects that they will iterate towards a hybrid event model. However, details (such as access and pricing) are still to be determined.

“We’ve set up a small internal task force within FT Live which is examining what the future is going to look like,” he explained. “What people’s preferences might be today might not be the same not only in five  years’ time, but in months or even weeks.”

These publishers may have the scale that makes it easier to convince top-tier sponsors to get on board, but there are lessons for publishers of all sizes. Virtual events offer a wider audience and higher engagement than in-person events, whether that be hundreds or thousands of attendees. 

As for reader revenue, features like on-demand viewing or virtual networking can be sold as an add-on, or as a subscriber-only benefit. The key is being flexible in your offerings and understanding what your audience will respond to as the situation evolves.

Advertising | Revenue

Podcast ads: a bright spot in the dim digital advertising sector

Covid-19 has hobbled untold sectors, and advertising is one of them. In July, two research outfits revised their industry growth estimates in negative directions. The lone bright spot among the various advertising channels is podcasting. Originally targeted to expand by 30% this year, IAB/PwC halved its estimate. However, that still equates to more than $100 million in net expansion. Indeed, brands are slated to spend nearly $1 billion on podcast advertising in the U.S. in 2020.

By contrast, the total global advertising category – inclusive of TV, print, radio, digital and out of home – will contract by 9% this year. This is according to fresh estimates from Zenith’s Advertising Expenditure Forecast report, published on July 27. Brands slashed ad budgets most aggressively in Western Europe and in the out-of-home category. But no geographic region and only a couple of formats (podcasting, digital) have been spared. 

Solid fundamentals fuel podcasting’s (relatively) rosy forecasts

Given the uncertainty and fragility of global economic conditions, we’re all firmly in the “any non-catastrophic news is good news” camp. (Unless you work at Goldman Sachs, of course, which makes gobs of cash so long as the sun rises, but that’s a topic for another day.) That said, podcasting’s fundamentals have been headed in the right direction for several years now. 

I first wrote about podcast advertising strategies for DCN in March 2019, and favorably. While growth has been healthy since, the market has by no means taken off. However, a confluence of factors could facilitate a podcasting growth spurt in the next few years. 

Experienced advertisers make up a big chunk of the market
 Direct-to-consumer (“DTC”) and financial services brands generate more than one-third of advertising activity. These companies can serve as an important anchor for the category moving forward. They both understand advertising and take a long view of their programs.

Spotify is driving changes in habits with both consumers & advertisers
It would be incorrect to claim that Spotify is betting its future on podcasting. But it’s definitely a meaningful part of their strategy. In July, the company reported both increasing consumer engagement with podcasts – up over 100% year over year – and has committed to the format in a big way. To wit: the company invested hundreds of millions of dollars over the past year into deals with organizations such as The Ringer (Bill Simmons’ venture), The Joe Rogan Experience, and Omnicom.

It’s a small market
Because it’s currently a niche market, positive growth rates should be easy to maintain. Brands spend more than $200 billion every year on advertising in the US and carve out less than .5% of budgets for podcasting. So podcasting will not fuel ad industry growth and sustenance for the next decade. But it is well-positioned to be a consistently positive storyline. 

What brands need to be concerned about 

As is the case with most nascent markets, there are reasonable questions about podcasting’s future that linger. 

Staying power
As Digiday’s Pierre Bienaimé explains, “The question of whether podcasts have hit the American mainstream is kind of like asking the same about Major League Soccer.” The advertising industry has been waiting for podcasting to ‘pop’ for several years now, and the reasons for why it hasn’t persist.

Standardized success metrics
Podcasting’s performance metrics are more akin to traditional (offline) advertising formats than digital ones, such as audience size and awareness. This issue needs to be reconciled by media companies to facilitate growth.

Discoverability
Even experienced podcast listeners often have difficulty both locating a new pod they are aware of and ‘shopping’ for new ones. Pods need to be as easy to find as a website or social media account. 

A promising future

While it would be inaccurate to say that podcasting is in full-on growth mode, the format is showing signs of long-term viability. Over the past decade, its evolution has been characterized by fits and starts, but crossing the billion dollar market size threshold this year is notable. 

Alan Osetek, former global CEO of Resolution Media – an Omnicom company and one of the largest search advertising companies in the world – is cautiously bullish. “I’m a huge fan of podcasting, but it’s suffered from an identity crisis. It’s not quite ‘digital’ because it isn’t really a direct response tactic, and that’s what’s been driving online ad growth for 20 years.” 

He goes on, “but podcasting isn’t really ‘offline’, either, since most people listen via smartphones. I just think it took brands awhile to figure out how to deploy the tactic within the overall marketing mix. Now that they’ve done that, I believe podcasting is here to stay. And I wouldn’t have said that as recently as a couple of years ago.”

About the author

Tim Bourgeois is a marketing advisor who helps brands optimize ROI on advertising, technology and agency investments through media audits and strategy engagements.

Advertising | Revenue

Don’t drive blind: Use benchmarks to navigate digital advertising

A day in the life of Advertising/Revenue operations may sound monotonous, but no challenge is solved in exactly the same manner. Today’s redirects and malvertising attacks are very different from tomorrow’s inflammatory content or phishing schemes. It’s time to change course in ad operations, and take a route guided by a publisher-specific benchmark.

Privacy regulations and increasingly sophisticated attacks are becoming ever more prominent in digital advertising. So, publishers must shut down risks that negatively impact monetization efforts, or worse, drive regulatory penalties.  Industry benchmarks allow you to assess your digital property’s distinct risk profile.

Understanding the risks

Raising awareness of these risks across media publishers is imperative. During the past six months, continuous scanning of dozens of B2C websites across a variety of industry segments uncovered the third-party code risks dwelling in their respective digital ecosystems.

For U.S. Media publishers, here’s what The Media Trust discovered during the past six months:

Security risks:
  • 92% of executing code is attributed to third-party code, up from 81% in 2019
  • 18% domain variability, reflecting the percentage of new domains to the publisher’s site compared to the previous month
Privacy Protection risks:
  • on average, ~1,500 cookies are dropped on user devices every time they access a media site, a factor that should be included in assessing CCPA compliance
  • 37% of those cookies have a lifespan greater than 12 months, a violation according to existing regulatory regimes, including CNIL’s “French Cookie Law”
  • We find decades-long lifespan cookies from reputable partners every day across these properties, some approaching an 8,000+ year lifespan 
 Performance risks:
  • 1.6MB is the JavaScript file size, approximately 60% more than the generally recommended 1MB polite limit
  • 5.66 seconds is the aggregate total load time; if you’re experiencing page latency issues you should look at the contribution from third-party code 

Addressing the issues

Publishers can no longer ignore the risks associated with unmanaged third-party code. Unfortunately, investments in resources to build the perfect customer experience and drive revenue often lead to unacceptable malware attacks, redirects, unauthorized collection of personal data, and more. Benchmarks provide a clear means to pinpoint and remediate issues out-of-sync with industry peers.

Brand integrity, regulatory compliance, and the bottom line are at stake. Ad operations must implement strategies that will control unmanaged third-party code. In the same way that brands exercise supply path optimization (SPO) efforts to understand pathways that impact performance and drive revenue, publishers should focus on identifying those vendors that cause problems.

Using these industry benchmarks, publishers can pinpoint which code and which corresponding vendors disrupt your customer experience. The ability to distinguish between what will cause security, regulatory, and performance issues (malware, data breaches) versus what will annoy your users (redirects, PII scams, and poor ad quality) is the first step. 

The dangers of driving blind are self-evident. With benchmarks, ad operations teams can change their processes to focus on the vendors that cause problems, and better navigate a path to success.

Advertising | Revenue

Server-side tech will drive the future of publisher digital advertising revenue

Every war produces collateral damage. And the browser wars are no exception. 

For years, publishers reactively adjusted their monetization strategies based on browser changes to accommodate a rapidly changing landscape in the name of revenue preservation. Many publishers rely on client-side bidding via web browsers to monetize their sites, despite lackluster performance and unpleasant side effects. These include clunky, slow loading sites, personally identifiable information (PII) vulnerability, and interruptive, obtrusive ad experiences.

The resulting situation is driving new publisher approaches – including server-side technology – that have a tremendous impact on their business. The industry is reeling from the economic impact of Covid-19, reacts to CCPA enforcement, and readies itself for the next phase of digital advertising. Yet at the same time, publishers must address certain fundamental technology blockers in the name of reclaiming their monetization strategy and futureproofing their ad revenue through server-side technology.

Let’s assess how investment in server-side solutions will catalyze greater autonomy, sustainability and innovation for publishers in the long run.

Client-side vs. server-side bidding

In client-side header bidding, also known as browser-side header bidding, publishers take their inventory to multiple demand partners as impressions become available. Ad requests are sent to demand partners to place their bids. The highest bid is selected and the winning bidder’s ad is displayed. Code, or JavaScript (JS), lives on the publisher’s page and is executed on users’ browsers when they visit the website.

With server-side header bidding, auction logic is executed on a server. The user’s browser makes a single request to the server, which sends and receives all bid requests. Once the bid is sold, the ad is displayed without affecting page load time.

The browser is not your friend

Many publishers rely on client-side bidding for site monetization through digital advertising. However, the dynamics aren’t always in their best interest.

  • Poor User Experience Due to Latency: JS and ad tags are notoriously slow. That’s because they’re dependent on the number of ad slots and prioritization of when and how they load. Slow load times result in jumpy, inconsistent content, poor browsing UX, and attrition as a result of reloading or exiting the page.
  • Non-Data Regulation Compliance: Ad tags in and of themselves are not inherently non-compliant. However, the tag, not the publisher, determines what data is sent to a partner. If code sends data to another partner without explicit user consent, publishers are susceptible to substantial privacy legislation enforcement. Publishers that do not own all of the code on their page are at risk for non-compliance.
  • Browser Overreliance: Browsers serve as a home base for publisher audiences, auctions, rendering and more. With continual shifts in browser dynamics, there’s escalating opportunity cost associated with publisher over-reliance on an environment in which they exert minimal control.

Some of the browser-based workarounds publishers leverage today likely won’t be viable tomorrow. To extricate themselves from the dynamics of client-side bidding, publishers should invest in server-side technology that will lay the groundwork for monetization innovation in the future. 

The solution is server-side

Server-side technology will ultimately be a catalyst for publishers to reclaim autonomy, sustainability, and control of monetization today and well into the future. There are three chief benefits of server-side technology that pave the road for publisher success:

  • Optimal User Experience: Server-side technology, like content distribution networks (CDNs), preserves the user experience by enabling publishers to optimize sites for faster load times and lower latency. The result? Improved UX and prioritization of when and how ads load. The faster the pages load, the better the user experience will be. And better UX translates to persistent, returning audiences that can be monetized. The introduction of CDN edge computing transitions decisioning around each ad unit – how auctions are managed and when units load–to publishers themselves. This results in optimal monetization and UX. 
  • Identity Solutions: The end of third-party cookies on Chrome is less than two years away. Server-side solutions position publishers for their next phase of innovation: solving for audience and attribution. With the decline of the 3rd party cookie, identifying, targeting and attributing actions to website visitors becomes increasingly challenging. Newfound autonomy will extract publishers from the browser wars. It will also facilitate implementation of identity solutions like publisher first-party identifiers or LiveRamp’s Authenticated Traffic Solution (ATS). This improves addressability across the open web by matching known users to a persistent identifier and enabling marketers to target users in a privacy-first manner.
  • Control: With client-side bidding, publishers are beholden to decisioning they can’t control, like browsers blocking third-party cookies or the introduction of a new algorithm. But with server-side logic, publishers are empowered to build their own valuable walled gardens, where they determine the rules, dynamics and monetization strategy.

Long-term goals

Server-side solutions – like a prebid server – might result in temporary revenue decline due to a departure from third-party cookie targeting. But that revenue is short-lived. Publishers are wise to play the long game. The innovation and revenue growth of server-side platforms like Amazon suggest the short-term inconvenience is far outweighed by the long-term reclaim of revenue control. 

To extricate themselves from browser dynamics, ensure data regulation compliance, build groundwork to preserve UX and preserve tomorrow’s monetization, publishers are wise to look to the server: Investing in server-side innovation today is the ultimate future-proofing for publishers’ businesses tomorrow.

Advertising | Research | Revenue

The next ad quality plot twist: Upholding user trust during the election season

Has 2020 been a difficult enough year for publishers? Well, get ready for another plot twist.

Election season in the U.S. has been heating up and will soon reach a boiling point. Both major political parties have amassed war chests to fuel their advertising campaigns. And this year’s race – just like a lot of things in 2020 – is shaping up to be unlike elections in the past.

Audiences in the U.S. are watching this race closely. And because new campaign messages and issues come out almost daily, there’s always something new to engage with. At the same time, the public’s trust in media is in jeopardy. Users are concerned that political content may contain misleading information. However, that concern leads them to distrust politicians and media outlets themselves.

Publishers are working hard to create content audiences can trust, engage with deeply, and return to. The last thing they need is to see misleading or deceptive ads on their pages, undermining their efforts.

A fake ad problem

Recently, publishers had a crash course in building audience trust and engagement while combating “fake ads” – ads with misleading content, or that link out to misinformation or scams. Since the pandemic began, 67% of publishers said they’ve encountered either a “significant” or “great” amount of fake ads, according to a survey we recently conducted in conjunction with Digiday.

Additionally, publishers cite ads that lead to pages unrelated to the ad creative as their top concern. Furthermore, publishers report that they’re seeing a growing number of ads that contain misleading information in the ad content.

Now publishers need to use what they’ve learned to better manage the growing onslaught of political ads. Indeed, 51% of publishers say they expect to deal with deceptive political ads this year. And that’s not just publisher pessimism speaking. Facebook and CNN have both taken the Trump campaign to task for deceptive ads. And leading news publishers continually fact-check claims made by the Trump and Biden campaigns alike.

Business breakers

Quality ad content (and not just filling ad slots) must be part of a publisher’s revenue strategy. According to the aforementioned GeoEdge survey, 49% of advertisers say they have avoided or ended business partnerships with publishers because those pubs had hosted deceptive ads. Among publishers, 49% said that when users raised complaints over deceptive ads, the consequences for their own business was “severe” or “very severe.”

We already know this. Ad content, and not just filling ad slots, is part of revenue strategy.  Nearly 70% of publishers said they “encounter a moderate or large number of deceptive ads per week.” Almost half of advertisers say they have avoided pubs, or ended relationships with publishers, because of deceptive ads.

This should raise alarms: Traffic and engagement are what give publishers value to advertisers. But advertisers want more than just good traffic. Like users themselves, they want a trustworthy product, and the ads are part of the package.

Monitoring issues

That said, far too many publishers (36%) still rely primarily on manual methods for monitoring fake, deceptive and low-quality ads. And 56% say they spend a “moderate” or “large” amount of time blocking such ads. This may seem a bit old-fashioned. After all, publishers are aware that it’s possible to automate these processes. But then again, many of those automated solutions are themselves using old-fashioned, blunt-force methods. The fact that 83% of publishers accidentally block ads that meet their standards suggests they’re using outdated methods for blocking bad ads. The cutting edge of ad quality is far beyond all that.

Publishers would be best served to seek automated solutions that do the job right the first time and don’t require ops teams to do extra clean-up work. Blunt tools cause publishers to leave money on the table by screening out good ads along with the bad ads, and by keeping ops teams mired in the present and past rather than looking to the future.

This is no time to backtrack and solve yesterday’s ad quality problems when every day brings surprising new revenue and workflow challenges. Sharper ad quality tools allow publishers to block keywords, phrases and industry verticals automatically. They can then drill down, set detailed criteria, and really align ad content with page content. With all the upheaval the digital industry has experienced, programmatic channels are especially important for publishers’ revenue strategies. Those channels are where publishers can discover quality advertisers that can become trusted partners over time. 

Seeking solutions

Publishers need all the revenue they can get at this moment, and the election season puts a lot of revenue on the table. But to maximize this moment, publishers need precision in rooting out deceptive ads. They must go beyond automation and toward customization. There is a reputational and revenue risk in hosting deceptive ads, but our media reality demands a scalpel rather than a mallet to separate misleading from legit political ads.

One final reminder: This election season will be highly digital. The pandemic is keeping users at home, even more wired in than usual. Campaign events that would normally be held in person mostly moving online. Publishers need this engagement to drive revenue and attract quality advertisers. And engagement needs audience trust: trustworthy page content and ad content together.

Now is the time to develop a customized approach to ad quality. It must be tailored to the publisher’s content and audience, with a steady eye on user experience. This is best achieved with the assistance of ad quality partners who can be just as responsive and offer customizable solutions. The election’s exact plotline will be impossible to predict, and the stakes for engagement and monetization are high.

Publishers need to devote their resources to producing content audiences can rely on and to developing a framework for maintaining ad quality as early as possible. Of course, publishers don’t need to handle the heavy lifting on their own. A good ad quality partner will have the technology to automate monitoring and blocking deceptive ads. Sophisticated, nuanced, proactive service helps ensure that publishers can block the deceptive ads that undermine their work, and let in the quality ads and advertisers that help publishers keep moving toward the future.

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